BULLETIN: John Bravata, Figure In Alleged ‘Billionaire Boys Club’ Ponzi Scheme In Michigan, Arrested At JFK Airport After Return From Italy
BULLETIN: John Bravata, who was sued by the SEC in July 2009 in a Ponzi Scheme case that became known as the “Billionaire Boys Club” case, has been arrested at JFK International Airport in New York, the FBI said.
Bravata was arrested on an inbound flight from Italy, prosecutors said. He is charged with wire fraud.
The Bravata civil case has been marked by oddities, including the November 2009 indictment of his defense attorney on charges he was running his own fraud scheme. The attorney, Gregory Bartko, was convicted last year.
Separately, Bravata was accused in 2009 by the SEC of violating the asset freeze in the civil Ponzi case by taking loans against life-insurance policies. Judge David M. Lawson ordered Bravata to repay the money.
Now Bravata has been charged criminally. He will be prosecuted in the Eastern District of Michigan.
From 2006 through 2009, the FBI said, “Bravata knowingly participated in a scheme to defraud investors. Bravata and those working on his behalf made multiple misrepresentations to numerous prospective investors, including misrepresentations regarding how their investment funds would be utilized, the security of funds invested with BBC, and the returns that could be expected by investors of BBC.
“Bravata also misled investors by telling them that managers of BBC would not earn money unless BBC was profitable,” the FBI said. “He also represented that the managers of BBC did not take fees, commissions, or a salary. In reality, Bravata and others received lucrative compensation from BBC and related entities despite that fact that BBC was never profitable. Bravata also used investor funds to pay for the construction of his roughly 18,000 square foot personal home and to pay for other personal expenses.”
A California Ponzi scheme in the 1980s also was known as “The Billionaire Boys Club.”
Bravata’s company is known as BBC Equities LLC.